Tulsa-Based SBCC Helps Small Business Grow

Since its inception in 1993, Tulsa-based Small Business Capital Corp. has approved 126 loans on total project costs of $153.9 million, helping to create more than 1,560 jobs in the Tulsa area.
A non-profit organization that assists businesses in obtaining long-term, fixed rate financing through the Small Business Administration 504 Program, the SBCC has generated SBA debenture for these loans of $56.1 million. Thirty-two area banks have participated with SBCC in the amount of $79.8 million.
“Our main goal is to help small business expand and to add jobs,” said Peggy Rice, president of SBCC.
SBCC is the only certified-development company to hold the SBA designation as an accredited lender (ALP) in Oklahoma. It is a credential awarded on the basis of the company’s loan portfolio and overall performance, Rice said.
“What that helps us to do is get a 24-hour turnaround time response from SBA” on loan requests, she said.
In addition, the SBA this year designated SBCC as Abridged Submission Method (ASM) for submitting applications, which allows SBCC to submit less paperwork when submitting the application to SBA, Rice said.
SBCC operates with three employees out of 1,644 SF of office space in the Bank of America Center, Suite 1300, 15 W. Sixth St.
The SBA 504 program is an economic development program that allows small businesses to access a below-market-fixed interest rate on a portion of their loan when financing commercial real estate, machinery and equipment and new construction. The interest rate for November is 6.73 percent on a 10-year note and 6.54 percent on a 20-year note. The SBA rate is fixed for the term of the loan. The current prime rate is 8.25 percent.
The SBA 504 program also requires a lower equity contribution from the borrower, in some instances as low as 10 percent.
SBCC makes loans in the manufacturing, professional, service and retail fields and clients include mostly Tulsa area firms, including Marco Industries, Inc.; Metal Buildings Industries; Interstate Tool and Manufacturing Co.; A. Mark Smiling PLLC; Miller Medical Management Inc.; Green Country Testing Inc.; Leonard Marker Funeral Home; Sculptures Salon & Spa; Sleep Inn & Suites; Batman’s Good Food and Convenience; Grigsby’s Carpet Showroom Inc., and Pet Stop Inc.
As one of five certified development companies in Oklahoma, the SBA allows SBCC to make loans in any part of the state, Rice said. “However, we focus on Tulsa and the Tulsa area.”
There is no maximum project cost. However, the SBA portion is limited to $1.5 million participation for most projects, $2 million for projects meeting a public policy goal and $4 million for eligible manufacturing projects. The minimum project size is $125,000.
In an example of a $1 million total loan transaction, Rice said a bank would loan 50 percent and take a first mortgage, “and then we come in and do 40 percent and, on our 40 percent, you get $400,000 at a 20-year fixed-rate loan, and you put in 10 percent.”
“A bank will typically loan you 80 percent at a floating rate,” she said. “Plus, you have to put up 20 percent of the money.”
“There’s not a whole lot of small businesses around that have 20 percent in cash laying around,” she said.
If a business only has to put in 10 percent at a fixed rate for 20 years, the program lowers payments and “helps your cash flow because you are able to keep more money in your business,” Rice said.
She said SBCC finds most of its clients by keeping in touch with area banks.
“We have done some direct mailing to manufacturers,” she said. “But really it all comes from bankers.” ?

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